Credit Agricole SA (EPA:ACA) Securities analyst Mike Mayo spoke with FOX Business Network (FBN) about Citigroup Inc. (NYSE:C) Chief Executive Officer Vikram Pandit’s announcement that he would step down today. Mayo said, “This is a ludicrous CEO transition. I have never seen one like this in my twenty-five years in covering the industry,” Mayo went on to say the transition is “eye-popping” and that, “Citigroup has had some of the worst corporate governance under Vikram Pandit and in fact I think the way this transition has taken place is a microcosm of that poor corporate governance.”

“There is no bigger critic of the old CEO of Citigroup Inc. (NYSE:C), Vikram Pandit, than me. The stock price performance of Citigroup while he’s been CEO has been the absolute worst of the large banks. I don’t feel as though Citigroup had proper oversight from the CEO and the top of the firm since he has been in place. I think the board has actually taken a step where they probably listened to a few shareholders. It is just the way this transition has come about is really eye-popping.”

On Citi naming Michael Corbat as its new CEO:

“Twenty-nine years at a company, you probably know how things are run, but a company like Citigroup Inc. (NYSE:C) with $2 trillion of assets is tough for any one person to run that well. I am keeping an open mind. I think sometimes a change can be positive. I think Citigroup has had some of the worst corporate governance under Vikram Pandit and in fact I think the way this transition has taken place is a microcosm of that poor corporate governance….And it’s one day after we were all listening to the CEO talk about the long-term strategy. What is taking place here? By the way, where is the conference call with the new CEO? This corporate governance – whether it’s just in the last few hours or the last few years – has been awful, so that is the opportunity and challenge of the new CEO to improve a culture that has led to a lot of mishaps and some underperformance.”

On whether Corbat is a long-term answer:

“I am not sure. I think you have one warning sign. 182 days ago was a negative say-on-pay vote, and what that is, is the shareholders spoke up and said we do not like the executive compensation plan, and with good reason because it had artificially low hurdle rates where the top executives would get incentive pay for earning one-fourth of what they had earned the prior two years. 55 percent of the shareholders voted against the pay of the CEO and top executives. What better concrete example of some concern among shareholders than that and then it is played out here. There must be some story behind the scenes. I don’t know what it is. This is a ludicrous CEO transition. I have never seen one like this in my twenty-five years in covering the industry.”

On whether Citi will be a better bank in a year from now:

“I hope so. I think what they need to do is have more clear goals. Under Vikram Pandit, one day it was let’s grow assets and they still had this target return on assets, which is one-fourth to one-half above the industry average for the last 30 years, and yesterday they had a few new metrics they were showing that they hadn’t brought out as often, so everyone needs to be on the same page when it comes to goals. And the actions – they need to be more aggressive in selling off the problem assets. I asked a question on the earnings call yesterday, why not be more aggressive, and the CEO said there is not funding for people to buy these assets or, perhaps, they are not written down as aggressively as they should. And then they really need to show that shareholders matter. I think that’s the biggest issue in Citigroup. It has been a culture where shareholders do not matter enough. Look at their disclosure. Even on yesterday’s conference call, there is a standard measure when you want to see how much risk a bank is taking in trading, called value-at-risk, and the company would not disclose the most basic measures of risk. Why would they not disclose that? Also they do not disclose returns by business line. When you compare Citigroup’s disclosure to many other banks, it’s really poor. You take that, you take the compensation scheme that looks pretty rigged and it comes off with an attitude of shareholders don’t matter, and I think that’s the opportunity for the new CEO to improve that perception with shareholders.”